Making Tax Digital is no longer something to worry about “later”. For some sole traders and landlords, it started on 6 April 2026. If your total qualifying income from self-employment and property is over £50,000, you now need to follow the new rules for Making Tax Digital for Income Tax. 

That sounds technical. It does not need to feel that way.

This guide explains what has changed, who it affects, what you need to do, and what you should not panic about.

What is MTD, in plain English?

Making Tax Digital for Income Tax is HMRC’s new way of collecting income and expense information from certain sole traders and landlords.

Instead of keeping everything until the end of the tax year and sending one Self Assessment return in the usual way, you now need to keep digital records, use compatible software, send quarterly updates, and then complete your end-of-year tax submission through that system. 

Who does MTD affect right now?

Right now, MTD for Income Tax applies to sole traders and landlords whose combined qualifying income from self-employment and property is over £50,000. It started on 6 April 2026. 

HMRC is introducing it in stages:

• From 6 April 2026 if qualifying income is over £50,000
• From 6 April 2027 if qualifying income is over £30,000
• From 6 April 2028 if qualifying income is over £20,000

So even if you are not affected yet, this is still worth paying attention to now.

What does MTD actually require you to do?

In practice, there are four main changes.

1. Keep digital records
You need to keep your business and property income and expenses digitally using software that works with MTD. 

2. Use compatible software
HMRC expects you to use software that is compatible with Making Tax Digital for Income Tax. You should choose that software before signing up. 

3. Send quarterly updates
You will need to send summaries of your income and expenses during the tax year, rather than waiting until the very end. HMRC’s standard deadlines for the first year include updates due by 7 August 2026, 7 November 2026, 7 February 2027, and 7 May 2027. 

4. Complete the year-end process
You still need to finalise your tax position after the end of the year. Under MTD, that end-of-year submission is still required, and the tax payment deadline remains the normal one. HMRC’s guide shows the final submission and payment for the 2026 to 2027 tax year due by 31 January 2028.

What MTD does not mean

This is where a lot of confusion starts.

It does not mean you pay tax four times a year

Quarterly updates are not the same thing as quarterly tax payments. They are reporting updates. The main tax payment deadline remains the usual one unless HMRC says otherwise for your specific situation. 

It does not mean every taxpayer is affected right now

MTD for Income Tax has not started for everyone. At this stage, it only applies to certain sole traders and landlords over the threshold. Partnerships will be brought in later, and HMRC says it will set out that timeline separately. 

It does not mean you can ignore it if HMRC has not written to you

HMRC says it may write to people it believes need to join, but it is still your responsibility to check whether the rules apply to you and to make sure you are ready in time. 

The most common mistake business owners will make

The biggest mistake is assuming this is just an admin change.

It is not.

MTD changes the rhythm of how you keep records and report to HMRC. If your bookkeeping is messy, delayed, or spread across receipts, emails, spreadsheets and memory, MTD will expose that very quickly.

That is why the businesses that cope best are usually not the most “technical”. They are the ones with the clearest systems.

What should you do now?

If you are already in scope

If your qualifying income from self-employment and property is over £50,000, you should:

• confirm that MTD applies to you
• make sure your records are digital
• choose compatible software
• sign up to the service
• get support if you are unsure how to handle the process

If you are not in scope yet

If you are likely to fall into the £30,000 or £20,000 groups later, this is a good time to get ready early.

The businesses that leave this too late will usually end up rushing their records, choosing software in a panic, and making a straightforward change feel harder than it needs to be.

What about penalties?

HMRC says that if you are required to use MTD for Income Tax from 6 April 2026, it will not apply penalty points for late quarterly updates in the first tax year, 2026 to 2027. However, penalties can still apply for late tax returns or late payment of tax. 

That should not be taken as a reason to delay.

It is better seen as a short settling-in period, not a free pass.

How One Click Accountant can help you

For many business owners, the hardest part of MTD is not the rules themselves.

It is the uncertainty.

Does this apply to me?

Do I need new software?

What counts as qualifying income?

What exactly do I need to do, and by when?

That is where having the right accountant matters.

At One Click Accountant, we help make tax and compliance feel clearer, calmer, and easier to manage. So if MTD has just become relevant to you, or you suspect it will soon, now is the right time to get organised.

Because MTD does not have to be stressful. But it does need to be taken seriously.

Need help with MTD?

If you are a sole trader or landlord and you are not sure whether MTD applies to you, speak to One Click Accountant.

We will help you understand what has changed, what action you need to take, and how to stay on top of it without the stress.